Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[Gigapress]

So, why and how did Hawaii suddenly appear?

Volcanic eruptions from an hotspot in Earth’s mantle in the Pacific Plate about 4000 km off the coast of the Americas produced a chain of undersea mountains, some of which grew large enough to reach above the ocean’s surface, thus creating a large archipelago.

 

[unk45]

Let's work from facts...

FACTS (from Cern, which I posted previously):
View attachment 1042541
Teslas TOTAL REVENUE, which Cern calls INDICATIVE REVENUE(TR=IR=Reported Revenue + change in Deferred Revenue & Unsatisfied Performance Obligations) was nearly $10B in 2023 (with Lathrop MF ramped at half mast [20GWh] for only a few months of the year) and the difference in unreported revenue is nearly $4B!

FACT: Lathrop MF will double in output to 40GWh, and unreported revenue will grow to $8-10B within 18 months (mid 2025) from this single MF

FACT: Lingang MF will ramp to 20GWh through 2025 and likely 40 GWh into 2027, as it does unreported revenue will balloon to ~$20B+ and beyond.

FACT: over the next 12 months, Tesla has told us they will recognize $1B of this Unreported Revenue (UR) in 2024

ASSUMPTIONS: The recognition of...
2025: ~$3-4B from ~$8-10B UR
2026: ~$5-6B from ~$12-15B UR
2027: ~$8-10B from $20B+ UR
2028: ~$10B++++

This recognition of revenue is pure profit realized by Tesla Energy in a given year no matter what you "advise people" @Zaddy Daddy this money WILL drop to the bottom line in a given year, and this profit WILL be multipled by profit growth (which is how it is customary to find an ideal PE from the PEG ratio =1), which is what I said in the post you responded to.

I'm not going to respond to your long post point by point. Maybe someone else wants to take the time to pick it apart. I don't.

This is helpful. As an additional point the following:
"...
Our solar PPAs, offered primarily to commercial customers, charge a fee per kilowatt-hour based on the amount of electricity produced by our solar energy systems." pg8 2023 Tesla 10K
There is nothing more explicitly differentiating between the Power Purchase Agreement and any other commercial sale, although the accounting consequences are quite different than those governing project finance, which we've discussed more.
The PPA's probably are only offered where Tesla actually has public utility licenses permitting sales of power, a couple years ago they had completed those in most of the EU, the UK and some parts of the US.
Originally IIRC most of us thought those were to facilitate selling Supercharger use. More recently these PPAs may be proliferating. If so they will undoubtably be treated as some type of subscription so are likely to generate continuous revenues and expenses.

I cannot find any quantitative disclosure. Does anyone else know? This could become a major revenue source.

 

[Gigapress]

This recognition of revenue is pure profit realized by Tesla Energy in a given year no matter what you "advise people" @Zaddy Daddy this money WILL drop to the bottom line in a given year, and this profit WILL be multipled by profit growth (which is how it is customary to find an ideal PE from the PEG ratio =1), which is what I said in the post you responded to.

Is it? Are we sure that all of the costs associated with that revenue have already accrued to the income statement? I don’t know enough about the accounting rules to be confident.

 

[hobbes]

Cybertruck launching in Europe this summer?

https://twitter.com/x/status/1784602451066204438

.

This sounds like a tour to me where they will present the Cybertruck. Doesn´t mean they´ll launch it. Would not make that much sense (except for general Tesla PR) IMHO when they are still very much production constrained in the US alone.

 

[unk45]

Volcanic eruptions from an hotspot in Earth’s mantle in the Pacific Plate about 4000 km off the coast of the Americas produced a chain of undersea mountains, some of which grew large enough to reach above the ocean’s surface, thus creating a large archipelago.

Producing also the tallest mountain in the world:
"Mauna Kea is a dormant volcano on the Big Island of Hawaiʻi that last erupted approximately 4000 years ago. At 13,796 feet above sea level and over 33,000 feet from the bottom of the ocean floor, Mauna Kea is the tallest sea mountain in the world."

Mauna Kea | Hawaii.com

Mauna Kea is a dormant volcano that last erupted approximately 4000 years ago. Explore Mauna Kea and fall in love with its beauty.

www.hawaii.com

 

[Singuy]

https://twitter.com/x/status/1784561310883344542

Tesla will spend around $10B this year in combined training and inference AI, the latter being primarily in car.

Any company not spending at this level, and doing so efficiently, cannot compete. -Elon Musk

I never really thought about the spending on inference ai. There's a lot of talk regarding the H100s, but I wonder how much is spent on the in car hardware/software.

Along those lines Elon has mentioned the in-car capabilities and hinted at utilizing the compute to run ai models one day. Would be nice to see them offer that as a potential revenue stream for Tesla owners and it could run similar to teslas energy/autobidder software. This would help smooth out demand troughs when robotaxi is enabled. Between robotaxi trips maybe a throttled version of compute use could generate some revenue and if ridership demand dips the car could transition to full ai compute use until robotaxi demand picks back up.

Every fsd computer is an inference board, so 2M boards a year, and then scaling up with model 2.5.

It's mostly peanuts compared to h100 as each inference board is around 100-150 dollars

 

[Snerruc]

Volcanic eruptions from an hotspot in Earth’s mantle in the Pacific Plate about 4000 km off the coast of the Americas produced a chain of undersea mountains, some of which grew large enough to reach above the ocean’s surface, thus creating a large archipelago.

That and autocorrect.

 

[unk45]

Is it? Are we sure that all of the costs associated with that revenue have already accrued to the income statement? I don’t know enough about the accounting rules to be confident.

NO, we are not. When discussing project accounting rules differ. In most casts costs are obviously reductions in cash, but in many cases the costs and revenues are allocated based on proportionate activity. The financial statements will record 'unsatisfied contract obligations' or some such, and that will reduce as work has been performed. Cash flow may be entirely different with both advance payments and deferred payments also recorded. Those complexities are why project finance includes accountants, finance and technical performance people. Generalizing about these is fraught...

But there are rough indications which are those summarized by CERN as shown by @Musskiah.
Despite the complexities those financial statement excepts are 'close enough for government work'.

Just remember the other fast growing items that deal with Power Supply, including commercial ones and retail ones including Superhchargers and large supplier agreements for use of Autobidder with residential or commercial power supply and use. None of those are explicitly separated, thus far.

Those all seem to be on the verge of being material.

 

[growler23]

With hindsight it is very clear that battery day was just an effort to do the minimal needed attention to a critical gap, that why it was not staffed. The real effort had shifted to bright and shiny- FSD, ai, robots. Nothing to do with sustainability. Teslas own 4680 engineering efforts have produced no promised improvement. CATL meanwhile is sampling and maybe now producing 4680 form class battery cells that they claim do in fact have higher yield. Prismatic 4680 form. Huh..innovation, they put several thousand engineers to work on this.

I had this same opinion for a while (that FSD, AI, and robots are orthogonal to, or even against the Mission), but for me that opinion is starting to shift.
My logic chain:
To complete the mission, we need to transition to 100% renewables.
One of the most lagging sectors in renewables is automotive, thus, we must address that as a priority.
To address that: N ICE cars must be replaced with renewably powered cars.
Replacing N ICE cars will take Y years. This is too slow for the mission.
Solution: make the replacement cars 5x more useful. This solution (FSD) requires AI, therefore, developing AI must be a priority.
Now the number of cars to be converted is N/5. This can now be done in Y/5 years.
So, in this chain, AI is not a bright, shiny distraction but is a necessary component for the mission to be timely.

Logic chain going on simultaneously (in parallel):
To complete the mission, we need to transition to 100% renewables.
To get the electricity generation sector on this, we need tons of batteries to support intermittent renewables.
To support those batteries (and the addition demand from "electrify everything"), we need tons of infrastructure work.
This infrastructure work in particular will require an army of electrical workers performing years of labor.
We have a massive labor shortage in the US and (if I read correctly) much of the developed world.
Therefore, we need a new labor supply. Labor must become more abundant and cheaper or this transition will stall.
Robots are now becoming feasible due to various advances, but robots are useless without AI.
Therefore, AI+robots are required to shore up the labor supply in the massive infrastructure buildout needed to complete the mission.
So, in this chain, neither robots nor AI is a bright, shiny distraction but are instead a necessary component for the mission to be timely.

@nativewolf I'm not saying these are a 100% accurate portrayal of the massive worldwide reality out there, but I think there is truth to each of these. From your many previous posts, I recognize you as a thoughtful person. Curious what you (and others here) think. Has Tesla lost their way with the mission? Or have they just had their "battle plan changed after contact with the enemy"?
I think as investors, many (not all!) of us agree with their new battle plan. But do we agree with it as advocates of the sustainability mission?

 

[Stormy24]

https://twitter.com/x/status/1784622478175907979

 

[Buckminster]

https://twitter.com/x/status/1784623340142915721

https://twitter.com/x/status/1784626913056571680

 

[Drumheller]

Sorry but when the Roadster is more than 5 years late the Semi a good year behind, I consider that poor projecting.

The Roadster prototype was revealed at the end of 2017 and described as the Roadster 2020. That would make it 3.5 years late from that estimate. It was not promised. It is also likely the lowest priority for Tesla.

As a fan, it is the most anticipated product for me and im disappointed by the delay, too. However, I'm not ready to make that purchase, yet, anyway.

This sounds like a tour to me where they will present the Cybertruck. Doesn´t mean they´ll launch it. Would not make that much sense (except for general Tesla PR) IMHO when they are still very much production constrained in the US alone.

Why show a product to people that will never be able to purchase it? What would be the point of teasing them?

 

[WattsHappening]

Is it? Are we sure that all of the costs associated with that revenue have already accrued to the income statement? I don’t know enough about the accounting rules to be confident.

I am not an accountant but I did stay at a Holiday Inn Express so cam chime in here.

The matching principle in accounting calls for revenue and COGS to be recognized in the same period. So just like revenue is deferred until it meets the rev rec standards to be recognized as revenue and sits on the balance sheet as a liability, some COGS are also deferred and sits on the balance sheet as an asset (prepaid expense). How much is an unknown.

 

[Knightshade]

The update from the v11.3.3 to v 11.3.4 was a minor update too! Back then the updates were coming less frequently than once a month. The pace has quickened and that is real.

Why do you keep posting untrue things my dude?

v11.3.3 to v 11.3.4 was only 6 days-- FASTER than this minor update.

Updates throughout development that took more than a month between releases were NOT REMOTELY the norm--- and LOTS of them were MORE quick than most of the v12 updates have been.

In fact from 9/11/201 (10.0 first release to influencers) until March 14 2024, there were 53 FSDb updates. Only 8 of those 53 were 30 days or more after the previous update.


Examples of FSDb updates less than 8 days from previous release:
10.0.1 released 6 days after 10.0
10.3.1 released 1 day after 10.3
10.6.1 released 6 days after 10.6
10.8 released 5 days after 10.7
10.10.2 released 3 days after 10.10
10.12.1 released 2 days after 10.2
10.12.2 released 6 days after 10.12.1
10.69.1.1 released 4 days after 10.69.1
10.69.3 released 2 days after 10.69.2.4
10.69.25 released 4 days after 10.69.3.3
10.69.25.1 released 4 days after 10.69.25
11.3.3 released 6 days after 11.3.2
11.3.4 released 6 days after 11.3.3
11.4.2 released 4 days after 11.3.6

 

[Knightshade]

Your source? The ones I've personally installed in commercial parking lots were 3-phase 208 volts AC. Fact.

My source for US streetlights being mostly 120v? Also facts- albeit potentially dated ones?

https://www.lrc.rpi.edu/programs/transportation/pdf/Columbus-Survey.pdf

The most common streetlight operating voltage was 120 volts (62%) followed by 240 volts (28%)

250kW was the limit of the V3 posts at ~400V. New V4 posts have 615A current limits and 1000V compatibility.

Sure. But that's 8 years after Elon said 350KW was a mere childs toy in reference to what V3 posts would do.

Each V3 cabinet on its own can draw ~350-375kW or so net *from the grid*.

Right-- real world results on V3 were significantly lower than Elon suggested they would be in 2016 as already cited- from grid was JUST as the level he called a childs toy, and charge to the car was significantly lower than that.

 

[Musskiah]

With hindsight it is very clear that battery day was just an effort to do the minimal needed attention to a critical gap, that why it was not staffed. The real effort had shifted to bright and shiny- FSD, ai, robots. Nothing to do with sustainability. Teslas own 4680 engineering efforts have produced no promised improvement. CATL meanwhile is sampling and maybe now producing 4680 form class battery cells that they claim do in fact have higher yield. Prismatic 4680 form.

One of the purposes of Battery Day was to raise industrywide awareness and interest in the 4680 form factor. Tesla's efforts were not equivalent to those of the top tier suppliers. Perhaps that was the hedge, or maybe even the primary purpose...to get the top tiers to adopt and mass produce the 4680 form factor. Since Tesla never fully staffed the 4680 project to the extent they could have, this seems plausible. Nonetheless, the batteries are coming, so however we got here, mission accomplished. The batteries are no longer the bottleneck.

 

[EVNow]

Updates throughout development that took more than a month between releases were NOT REMOTELY the norm--- and LOTS of them were MORE quick than most of the v12 updates have been.

I've a thread to track this.

In 21 & 22 we had frequent releases. In 23 it slowed down. Definitely faster again now - doesn't mean there is more progress.

Bottomline : Both V10 and V11 hit a plateau that needed a rewrite to break out of. Is V12 different ? We hope so - but we won't know for sometime.

I'll be looking for some kind of major feature release to prove V12 will be different - like handling school zones or a usable summon / autopark.

Wiki - FSD Beta release history

Here is the compilation of FSD Beta releases, starting with 10. All this information comes from Teslafi. Employee only dates are ignored. Release : Release number. Releases that most of the testers got are in bold and I'm calling them "major releases". Build : Software build number. Date ...

teslamotorsclub.com

 

[Skryll]

Cybertruck launching in Europe this summer?

Wish it was semi truck instead. Unlike in the USA, in Germany there is limited acceptance for apparent selfishly inefficient monster trucks unless things changed there significantly in last 20 years.

Which means larger leverage for interested parties to agitate against Tesla.

Not many raptors to displace.

The semi truck on the other hand nobody can really complain about as it solves pollution and safety challenges of the current industry.

But maybe they are not launching it but rather doing a show and tell tour to stir up awareness of the brand and what products are already available in Europe.

 

[Knightshade]

I've a thread to track this.

Which is, of course, where I got most of the derived stats I posted- so thank you for that chart existing and apologies I didn't properly link to it originally

Bottomline : Both V10 and V11 hit a plateau soon after first release that needed a rewrite to break out of. Is V12 different ? We hope so - but we won't know for sometime.

Yup-- and even when performance improvements leveled off it was quite common for point releases (the third or fourth set of #s in the version) to see a bug fix release in single-digit # of days from last release.

Cybertruck launching in Europe this summer?

https://twitter.com/x/status/1784602451066204438

.

how would that make any sense unless the real demand in the US is terrible? If demand in the US is good it'll be inherently cheaper and easier to ramp US deliveries, for at least another year if not more, before exporting made any sense....(nor would adding CT in Berlin make any sense given all the cells are made in the US and the first lines are still just now ramping up in Texas)

That's apart from all the EU rules we've been told the CT can't comply with for safety/pedestrian reasons.

 

[Musskiah]

Is it? Are we sure that all of the costs associated with that revenue have already accrued to the income statement? I don’t know enough about the accounting rules to be confident.

I agree there should be a better understanding of exactly how much drops to the bottom line. Perhaps someone with a greater understanding of how the costs of unrecognized revenue are treated/accrued/accounted @The Accountant can bring clarity. @unk45 threw his hat in the ring I see. Regardless, I think its safe to assume the unrecognized revenue WILL be much higher margin revenue.